Apr 14, 2020
 in 
Tech

The Fintech Industry’s Battle Against COVID-19

 BY 
Genevieve Montague
I

n this time of global chaos, it is quite likely that a lot of things will be different when we finally come out the other end.

While every single industry will be impacted to some extent, this period could be one where those within the fintech industry grow and even begin to push aside the more traditional companies they have been trying to disrupt.

Fintech Industry Sets Up For Success

Perhaps the biggest advantage that fintech has over traditional businesses is that their product or service is usually offered online, either through an app, a website, or a web-platform. Or all three.

What this means is that in times of global lockdown, most fintechs have nothing to shut down. Compare this to banks or other traditional financial service providers. These companies now offer online assistance, but their main infrastructure is usually one that is driven from a base of bricks and mortar.

Examples of Fintech Companies — Photo Via MEDICI

Not only does this bring problems in terms of what to do with the staff at these physical premises but there is most likely an unfamiliarity or unpreparedness in terms of how to move things from the physical world into the remote one.

Fintechs on the other hand also often operate out of offices like more traditional companies. The difference is that within these environments, much of the internal communication already takes place on Slack and Skype. Not being in the office then causes only minor disruption to normal working practices.

Adaptability

A key characteristic of most startups is their ability to adapt and pivot to change. Very few people would have predicted the crisis that has reared its head in recent weeks, but fintechs are still better positioned than most to ride out these strange times, and potentially prosper.

As Paul Geiger, President of Theorem Technologies puts it:

“TECH FIRMS, ESPECIALLY FINTECH FIRMS, STARTING NOW WILL BE GRADED AND VALUED ON THEIR ABILITY TO ADAPT THEIR COST MODELS AND SERVE REMOTELY.”Paul Geiger, President of Theorem Technologies

So while this is the kind of scenario in which fintechs could thrive, now is the time for them to deliver.

Ease of Communication

Source

With most fintechs having been in operation for 10 years or less, the culture of communication is also one that aids them in these trying times.

With fintechs often communicating via notifications or snappy emails, the language they tend to use is also a lot more friendly and direct than that associated with more traditional industries.

In times like these, where people are feeling anxious and nervous about what is going on, this ability to offer reassurance through simple but direct communication should also serve to reinforce relationships with clients.

As Rob Oddell of SALT Lending recently commented:

“BUSINESSES WITH QUALITY CUSTOMER SERVICE AND AN EMPATHETIC SUPPORT TEAM HAVE LIKELY FARED WELL, AS THEY HAVE BEEN ABLE TO HELP CLIENTS MANAGE STRESS AND WORK THROUGH ANY ISSUES STEMMING FROM MARKET VOLATILITY, ALL WHILE PROTECTING THEIR BUSINESS. WHEN BUSINESSES HELP CUSTOMERS WHEN THEY NEED IT MOST, CUSTOMERS REMEMBER THE EXPERIENCE, AND IT BUILDS BRAND LOYALTY OVER THE LONG TERM.”Rob Oddell, SALT Lending

Building a Base

And it is not only with individual clients that fintechs are trying to make the best of a terrible time.

Many fintech companies are reaching out to small businesses to assist them while times are hard. Again, building relationships that will well outlast this current crisis. Small moves but with potentially big implications.

It is, unfortunately, true that many companies across all industries will fall by the wayside thanks to the Coronavirus, but smart Fintechs are primed to thrive once the dust has settled on this nightmare.